Summary: In this episode of China Money Podcast, guest Chien Lee, founder and chairman of NewCity Capital, brings you inside the mysterious VIP rooms in Macau's casinos; explains how much you need to get a seat at the table; shows how the money flows from the casinos to the VIP room promoters, to the agents, and then to the players; discusses Macau's future scenarios; and reveals the latest with 7 Days Group after its privatization deal. Read an excerpt below, but be sure to listen and subscribe to the podcast for the full interview. Q：Lately, Chinese authorities started scrutinizing foreign companies operating in China, from drug makers, baby formula producers to car companies. What do you think the Chinese government is trying to achieve, and what does it mean for foreign companies operating in China? A: Every country has rules and regulations that need to be enforced. The Chinese government is just exercising normal procedures (to protect consumers). I'm in the hotel business. If there are any safety issues at our hotel (7 Days Inn), the government will shut me down. They will do the same for a foreign-owned hotel. I think China is only going to become more open and transparent in the future. Q: In 2012, Macau's casino gaming revenue hit a record $38 billion, that's up 13.5% year on year, and higher than the entire US commercial casino industry's revenue in 2011, which is $33.5 billion. Can you give us some historical perspective on how the gaming industry in Macau evolved? A: Macau is the biggest gaming city in the world. It's six times bigger than Las Vegas. Over 10 years ago, when Macau was handed over to China, the Chinese and Macau governments put in great policies to support Macau's growth. Back then, there was only one gaming license. Now, there are six gaming licenses. The Macau government opened the door to let international casino brands to enter Macau to create more competition. On the other hand, the Chinese government loosened (visa requirements) city by city, to let mainland citizens visit Macau. The Macau government has also implemented policies to make Macau not only a gaming destination, but also a great place to vacation with the family. I've seen more and more families in Macau over the past few years. They enjoy shopping, they go out to dinner, watch great shows like Circe de Soleil, Water Dance and other famous concerts. Q: More Casinos are still being built in Macau. Las Vegas Sands is hoping for another resort. Wynn Resorts are beginning to build another $4 billion resort. MGM Resorts was given permission for a $2.5 billion project. How big will this industry grow? A: Yes, the gaming industry in Macau is still growing very quickly. Billions of dollars are being spent to build more casinos. And, the government is doing lots more to strengthen Macau's infrastructure. A bridge is being built between Hong Kong, Macau and Zhuhai. Macau airport is under expansion. The cross-border facilities between Macau and Zhuhai are expanded already. The light rail transit system in Macau is being constructed. Another smart policy is the development of Hengqin Island. It will connect Zhuhai and Macau together. The University of Macau will build a new campus on Hengqin Island. Guangzhou Chime-Long is building a marine theme park there also. Phase I is going to open this year. My personal estimate is that the theme park alone will bring 10 to 15 million visitors a year to Hengqin, which is next to Macau. Because of the strong growth in China and the region, I think Macau's gaming industry will have on average double-digit growth for the next five to ten years........
